q20

Which of the following is assessable as ordinary income?

Select one:

Charlotte receives payments from friends and family for making one-off pieces of jewellery for them. She does not sell to the public and does not intend to expand.

A gift of $20 from your mother for your birthday.

Neville receives $5,000 from the members badge draw at his local RSL club.

Wendy gives her accountant Bob a bottle of expensive wine as part payment of the invoice for preparing her tax return this year.

q19

Which are relevant factors to determine place of abode is permanent

Select one:

Intention as to length of stay outside Australia

Actual length of stay outside Australia

Intention to make that place of abode home

Duration and continuity of presence in the place outside Australia

All of the above

q18

What elements must the Federal Commissioner of Taxation show in order to assess a taxpayer?

Select one:

Identify the relevant taxpaying entity

Determine if the FCT has jurisdiction to tax through considering residency and source

Determine whether a receipt is assessable

Determine when the assessable receipt is derived.

All of the above

q17

What are the goals of taxation?

Select one:

Purely economic goals based around revenue for the government?

Accounting goals to provide a balanced budget for the government?

To create equal wealth for citizens?

To create equitable wealth for the citizens?

All of the above

16

Roberto is a resident for the full year and receives a cash dividend of $680 from The Hill Pty Limited, which was 100% franked. He also received a cash dividend of $1,000 from Broken Crown Pty Limited which was 50% franked. Roberto reinvested the dividend from Broken Crown Pty Limited through their dividend reinvestment plan.

In relation to these transactions, how much will Roberto include in his assessable income?

Select one:

$1,180

$1,680

$506

$2,186

q14

Which of the following is not cash basis income?

Select one:

A.

Interest derived by an individual on a savings account.

B.

Income received in advance with not obligation for refund.

C.

None of these

D.

Services income of one-person accounting business.

E.

Interest derived on an investment held by a major bank.

q13

Lisa is a professional female rugby player. She works full-time at Manly club as a rugby player for the Sea Eagles. The following has been disclosed by Lisa.

Salary$600,000

Bonuses from club$20,000

Total$620,000

Lisa also received a thank you gift from a fan for winning the State of Origin game. The gifts comprise of $9,000 worths of wine and $9,000 cash.

What is Lisas assessable income for the current income year?

Select one:

A.

$638,000

B.

$620,000

C.

$629,000

D.

$600,000

E.

None of these

q12

Trent has worked for a real estate franchise for the past 15 years. He has a dream of retiring from his job in five years, and living off the income from his investment properties. He now owns five investment properties in South Australia and is on the way to purchasing the next one.

Trent receives rental income directly into his bank account from the tenants.

Trent has given you the following information in relation to his rental receipts for the June CIY:

Total rent received$56,390

Rent in advance$750 (included in total above)

Rent outstanding$380

What is his assessable income in CIY?

Select one:

A.

$56,760

B.

$56,390

C.

None of these

D.

$56,020

E.

$56,770

Clear my choice

q11

Harriett is a resident of New Zealand in the current income tax year. She has derived the following income in the current tax year:

Salary and wages from a New Zealand company of NZD$55,000

Net rental income from an Australian rental property of $16,000

Fully franked dividends of $1,000 from an Australian listed company

Harriets assessable Australian taxable income for the current income year is:

Select one:

A.

Nil as she is a non-resident

B.

NZD $55,000

C.

$16,000

D.

$17,429

E.

None of these

q10

Tara currently has a term deposit account with her bank which has earnt $3,000 and a home loan to which she currently owes $300,000 and has paid $12,000 interest on in the current tax year. Tara has asked the bank to offset the interest income against her home loan debt.

The tax consequences of this for Tara are:

Select one:

A.

The interest income is not assessable and the interest paid is deductible.

B.

None of these

C.

The interest income is not assessable and the interest paid is not deductible

D.

This is an example of constructive receipt and the interest income is not assessable

E.

This is an example of a constructive receipt and the interest income is assessable

q9

Alex Hamilton (Australian resident) invests in a range of shares to derive dividend income. For the current income year he has provided the following information:

Fully franked dividends of $1,500 from ANZ Bank Ltd, which have been reinvested into new shares

Dividends of $2,500 franked to 50% from Hamilton Investments Pty Ltd

Unfranked dividends of $3,000 from Company XYX Ltd

Fully franked dividends of $5,000 from Woolworths Ltd

The franking credits that Alex must include in his taxable income are:

Select one:

A.

$3,214

B.

$3,321

C.

None of these

D.

$0

E.

$1,071

q8

In the current income tax year, Sophia has provided you with the following information:

Received $500 from CBA joint bank account held with her sister.

Received unfranked dividend of $1,000 from BHP.

Received a notice from NAB stating $5,000 unfranked dividend declared on 28 June 2020.

Sophias assessable income for the current income tax year 2020 is:

Select one:

A.

$6,500

B.

$6,250

C.

$1,500

D.

None of these

E.

$1,250